The classic image of a startup revolves around the IT industry and many guides and tips are geared towards tech and programming ventures. However, startups can be found in many other industries and they are just as fascinating. Take for example the manufacturing sector which represents a sizable chunk of any economy and is always in need of innovative solutions and products. So if you are trying to find the best path to success for your manufacturing startup, we have 5 of the top tips to help you. Whether you are in the food, fashion, robotics, or engineering sectors you will find these ideas useful.
Make sure you have the right product for current market conditions
This might be self explanatory but many times founders may have more than one product idea in mind when starting out. So when you make the decision of what to move forward to, make sure you take into account as many factors as possible. Of course, it would be great if the product you are manufacturing is something you are passionate about, but don’t forget about objectivity. You want to bring to market a needed and innovative product. Just like in the tech sector, your manufacturing startup needs to address a clear and burning need to be successful and to do so in an inventive manner. Don’t forget about listening to feedback from those who use your products or goods. As you are starting out there is more room for changes and being flexible than later in the business cycle.
Find the best monetization strategy and optimize costs
Monetization is a big challenge for all founders but it doesn’t have to keep you up at night. With the right strategy in place, your startup can prove to be profitable quickly. Of course, the strategy will differ when you are building an app compared to when you are manufacturing a product. You don’t want to overprice it but you also need to make sure the market will adopt it at a price that’s right. Another aspect to keep in mind for a manufacturing startup is that you will likely have suppliers to pay to keep your production line moving. Or you might need to ship your products at a cost to you, so you need to have a constant cash flow available. And your monetization strategy should take into account all costs you incur as part of your manufacturing process which is quite different from a tech startup where often all you need is a good computer.
Choose the right funding model
There are a few funding models to consider when embarking on your startup journey. Many of the advantages and disadvantages of each apply no matter your industry but there are a few particularities to consider when you are a manufacturer. Take for example bootstrapping. Choosing this model allows you to grow at your own pace, but you might also end up running short on goods that you need to keep your manufacturing line going. And that may result in lost customers as you won’t be able to deliver on your orders. Or, on the contrary, you end up ordering too much of a product and block some of your much needed resources. On the other hand, you can opt for venture capital funding and you will likely have enough funds to keep manufacturing moving. However, your processes and staff might not be ready to move as fast as your supply as it is not easy to increase manufacturing quickly.
Use software and apps to boost your operations
Though you might be looking for ways to save on money until you scale your startup, there is one area where you shouldn’t apply the same mentality: getting the right software and apps to manage your manufacturing processes. With software providers such as Katana you can track your invento ry in real time and actually end up saving more time and money. It is never too early for efficient management of your inventory. Especially as you are just starting out, you want to ensure that your processes are running smoothly. And with quick onboarding time and user friendly features you can reap the benefits immediately.
Always analyse and improve
Analyzing processes and results can be often overlooked in a startup as you are focused on keeping production on the line. However, taking the time to analyze and optimize processes can have a significant impact on your results. This is where software solutions should come to your help again. Monitoring your manufacturing business, analyzing your costs and efficiency can be done easily if you have the data easily available. This means you don’t want to dig through Excel files and other documents to find the answers you need. All your data should be easily trackable.
Running a successful manufacturing startup is not easy, but these tips can help you get a few steps closer to success.